Raymond expects demerger to bring new investors, FMCG business to grow
today Nov 19, 2019
Raymond expects the demerger of its lifestyle business to bring in new investors to the company led by its new focus. Raymond is also seeing strong sales in its fast moving consumer goods section.
“We were spinning the lifestyle business off into a separate company,” Raymond’s chairman and managing director Gautam Hari Singhania told ET Now in an interview. “We are putting the right governance into place, the right focus.”
The decision was made earlier in the month and is designed to allow the lifestyle business, which includes brands such as Raymond Premium Apparel and Park Avenue, to experience increased growth.
“I certainly believe that there will be a new class of investors that will come into a focussed business,” said Singhania. “Having met two important criteria - one on ROCE [return on capital employed] and one on minimum market size of the company, there will be a different set of investors that would get attracted to the real estate business. The real estate business will be significantly larger in the old company.”
The business’ FMCG business remains part of Raymond Limited and is experiencing significant growth. Raymond’s gross FMCG sales in the current year have reached Rs 800 crore and could cross Rs 1,000 crore with growth at around 20% to 25%, said Singhania.
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